The St. John the Baptist Parish public school system, which gets more than half of its $43 million in local revenue from sales taxes, must do a better job of evaluating the contractor it hired to collect the money, according to a new state audit. St. John has contracted for about a decade with ACI Inc. for sales tax collection and distribution, but it should ensure that the company's internal controls are up to par, the audit states.

ACI serves as the system's sales tax department. But because the company didn't provide the system with an independent auditor's evaluation of its processes, the school system "is unable to evaluate the adequacy of the controls of the outside vendor on their financial statements surrounding sales tax collections and distributions," says the audit, issued Monday by the state legislative auditor.

The school system collects a total of 4¾ percent in sales tax and keeps 2¼ percent, which translated into $22.6 million for education last year. The rest of the revenue is disbursed to other local government agencies.

According to the new audit, however, as of June 30, 2013, "the intemal controls of the outside vendor had not been evaluated for adequacy." The school system's fiscal year runs from July 1 to June 30, and the audit covers financial activities for last year.

Felix Boughton, the school system's executive finance director, said Thursday that the issue is being resolved. He said ACI Inc. has agreed to hire an outside auditor to evaluate its collection process. That report will be included in the fiscal 2014 audit, Boughton said.

"I agree it needs to be done," Boughton said. It's designed to "protect your assets, making sure there are no major errors."

The school system recorded $92 million in revenue last year. Of that, almost $30 million came from the state's Minimum Foundation Program for public schools.

Another shortcoming cited in the audit is the need for an employee succession plan in the school system's business department. Of the 10 staffers, nine -- including Boughton -- are eligible for retirement. The loss of all or most would severely hamper business operations.

Boughton said the system has created an action plan to hire and train additional bookkeepers and accounting clerks in that department. He said it will take almost two years to complete.

He also said the system has resolved a deficiency that led to accounting errors for its fixed assets. The audit said the errors, such as the lack of an updated inventory list and construction progression plan, came about because the system was dealing with Hurricane Isaac recovery and certain accounting assets were being performed by the purchasing department.